English Premier League Scores in Asia

By John Crowley

Malaysian businessman and new owner of English Premier League side Queens Park Rangers, Tony Fernandes, left, with manager Neil Warnock.

The Premier League football season has kicked off once again.

Not the matches, you understand, but the money-making bonanza off the back of it.

The EPL, like many vulnerable Western firms short on cash, is looking East for an injection of funds. Manchester United, the debt-laden league champions, announced earlier this week that it is planning to raise $1 billion from an initial public offering in Singapore.

The tranche, the size of which is yet to be announced, should significantly increase the value of the club which was acquired by the Glazer family six years ago in a leveraged $1.29 billion takeover.

Manchester United will be hoping that 190 million fans it claims it has in Asia will rush to buy into the IPO.

One Asian who certainly won’t be buying any shares is Tony Fernandes, the Malaysian principal of Formula One Team Lotus and chief executive of budget carrier AirAsia. He completed his takeover of fellow Premier League club Queens Park Rangers on Thursday.

Fernandes has secured a 66% stake in the club, having bought out previous shareholders Bernie Ecclestone, the Formula One supremo, and Flavio Briatore, the former principal of F1 team Renault.

He will be working alongside another leading Asian business dynasty—the Indian steel-making Mittal family—which have retained a 33% stake in QPR.

But is pricing out loyal supporters the “price” to be paid for turning the EPL into a global phenomenon?

Last Saturday only 15,000-plus fans (almost 20% short of total capacity) witnessed QPR’s first game back in the EPL since 1996.

Tony Fernandes saw them given a 4-0 drubbing at home by Bolton Wanderers, an established Premier League outfit, but hardly one of its giants.

QPR supporters have had a fractious relationship with the club’s former owners who increased ticket prices but failed to provide any significant funds for new players in the off-season. The club’s new majority shareholder says money will be made immediately available.

Mr. Fernandes joins a growing number of Asian owners of English soccer clubs. Carson Yeung, from Hong Kong, bought Birmingham City only to see the club relegated last season to the second tier.

Meanwhile, Indian poultry company Venky’s (India) Ltd. bought Blackburn Rovers last November who also flirted with relegation.

So, who in their right mind would ever contemplate buying an EPL club?

Players with vastly-inflated salaries and egos to match, restless supporters demanding “success” and an unpredictable revenue stream (ahem, that relegation problem) should ward away most people of sound mind. But football clubs are not run along conventional business lines.

The EPL in many ways is about passion, glamour and the improbable prospect of glory. It addles people’s heads.

Half of the Premier League’s 20 clubs are now in foreign hands. What is it that makes a businessman, particularly those from outside the U.K., be willing to make such a gamble?

Certainly, the EPL is a marketing dream if the club’s PR is handled in the right way. There’s also significant revenue to be made. The EPL is the world’s most watched association football league and, significantly, most lucrative, with combined club revenues of £2 billion in 2008-09.

That is why when businessmen kiss the club’s crest and wax lyrical about its history, they could just as well be saying: “Show me the money”.

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